India likely to keep economic growth momentum in FY25 despite risks – 2024-01-29

- Advertisement -

India likely to keep economic growth momentum in FY25 despite risks – 2024-01-29

* India estimates FY25 GDP near 7% vs projected 7.3% in FY24

* India expects domestic demand, private investment to aid

* India confident of weathering emerging disturbances like
Red Sea

NEW DELHI, Jan 29 (Reuters) – India expects its economy
to grow around 7% in the next fiscal year despite new
geopolitical risks emerging from the Red Sea crisis that could
affect global inflation and economic output.

In the government’s latest economic review on Monday, Chief
Economic Adviser V. Anantha Nageswaran’s team said India’s
growth will outpace the global economy in the next fiscal year
that starts from April 1, supported by stable domestic demand
and private investment.

« Recent events in the Red Sea may have brought back concerns
over reliance on global supply chains, further aggravating the
slower growth in global trade in 2023, » the government said.

If supply chain disruptions in 2024 persist, it could impact
trade flows, transportation costs, economic output and inflation
worldwide, it said, adding that India is « quietly confident of
weathering the emerging disturbances. »

The growth estimates come days before Prime Minister
Narendra Modi’s government presents its last budget before the
country heads to a general election this summer.

Finance Minister Nirmala Sitharaman will present the budget
on Feb. 1, factoring in the growth projections.

The latest projection compares with the first advance
estimates, where the economy was projected to expand 7.3% in the
current fiscal year, after growth of 7.2% in 2022/23 and 8.7% in

« The robustness seen in domestic demand, namely, private
consumption and investment, traces its origin to the reforms and
measures implemented by the government over the last 10 years, »
the review said.

S&P Global Ratings expects India will remain the
fastest-growing major economy for the next three years, putting
it on track to become the world’s third-largest economy by 2030,
overtaking Japan and Germany.

Strength in the financial sector and recent and future
structural reforms will make it « eminently possible » for the
Indian economy to grow above 7% in the coming years, the review

India expects headline retail inflation to gradually slow,
the review added but did not specify a time frame. Annual retail
inflation rose to 5.69% in December from 5.55% the
previous month.

(Reporting by Nikunj Ohri; Editing by Kirsten Donovan and
Jacqueline Wong)

Cet article est apparu en premier sur


- Advertisement -